Smartfinancial, Inc. · NYSE:SMBK
Smartfinancial — Merger or Acquisition (April 2021)
19 slides from Smartfinancial's merger presentation, Apr 14, 2021
Slide 1: Acquisition of Sevier County Bank
1 Acquisition of: April 14, 2021, 10:00am ET Webcast: www.smartbank.com (Investor Relations) Audio Only: 888 - 317 - 6003 Confirmation #: 3063532 Miller Welborn Chairman of the Board Billy Carroll President & CEO SCB S EVIER C OUNTY B ANK
Slide 2: Forward-Looking Statements
2 Forward - Looking Statements Certain statements in this communication may constitute “forward - looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 , Section 27 A of the Securities Act of 1933 , as amended, and Section 21 E of the Securities Exchange Act
Slide 3: Additional Information and Where to Find It
3 Additional Information and Where to Find It This presentation does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval with respect to the Proposed Transaction . No offer of securities shall be made except by means of a pr
Slide 4: In-Market Acquisition Rationale
4 ▲ Logical, in - market consolidation solidifying Sevier County market share (moving into the #1 market share) 1 and eliminating the entry of a potential competitor ▲ Market overlap creates ability to consolidate branches and drive substantial cost synergies ▲ SMBK’s infrastructure provides the cap
Slide 5: Transaction Overview
5 1) Total SVRH shares outstanding of 4,366,477 including restricted stock units which will vest upon the change - in - control 2) Based on SMBK’s closing stock price of $21.25 as of 4/13/21 3) SVRH tangible book value per share based on SVRH’s 12/31/20 tangible common equity / 4,366,477 shares and
Slide 6: Sevier County Bank Company Overview
6 CRE 55% Cons. RE 20% C&D 5% C&I/Ag 9% Cons./ Other 11% NIB 13% IB Non - Time 51% Time 36% ▲ Founded in 1909, Sevier County Bank is a historic community bank with a legacy of long - term client relationships ▲ 2019 recapitalization accompanied by complimentary management additions and organizationa
Slide 7: Core Market Enhancement
7 Core Market Enhancement Source: S&P Global Market Intelligence 1) Deposit market share data based on FDIC deposit data as of 6/30/20 2) US National Park Service – www.NPS.gov 3) 2019 attendance at both Dollywood and Dollywood’s Splash Country – www.Dollywood.com 4) 2019 attendance at four Sevier C
Slide 8: New Richmond Opportunity
8 New Richmond Opportunity Source: S&P Global Market Intelligence 1) Top four markets based on deposits in market as a percent of total SMBK deposits as of 6/30/20 as reported by the FDIC Comparison: SMBK Top Four Markets 1 New six - person commercial banking team in Richmond, VA with 100+ combined
Slide 9: Transaction Assumption Highlights
9 Transaction Assumption Highlights ▲ Identified fully phased - in cost savings of ~$7.1mm • ~63% of SVRH’s estimated 2021 noninterest expense • Phased - in at 25% in 2021, 100% thereafter ▲ $8.7 million in pre - tax, one - time costs and restructuring charges • $1.4 million in post - closing restru
Slide 10: Attractive Pro Forma Impact
10 Attractive Pro Forma Impact 15%+ Accretion to 2022 Earnings Per Share 2 31%+ Internal Rate of Return 1) Expected tangible book value dilution based on 9/30/21 closing. Earn back based on the crossover methodology. 2) SMBK 2022 EPS based on 2021 consensus EPS estimates of $1.74 per share grown at
Slide 11: Due Diligence Process
11 Due Diligence Process Diligence Focus Areas Consumer / Commercial Credit Treasury Management Legal / Compliance Accounting Policy and Tax Human Resources Technology & Operations Retail Operations x Comprehensive due diligence coordinated and led by executives of both SMBK and SVRH x Engagement of
Slide 12: Cost Synergies Breakdown
12 Salaries/Benefits 62% Occ., FFE, Rent, Utilities 7% Marketing 2% FDIC Ins./Exam 4% Legal/Professional 6% Telecommunication 2% Data Processing 3% ATM/Debit Card 3% Other NIE 11% Cost Synergies Breakdown 1) Source: Management estimates 2) Based on 2021 estimated SVRH expenses ▲ Analysis of expense
Slide 13: SMBK M&A Criteria Impact
13 SMBK M&A Criteria Impact SMBK Criteria Acquisition of SVRH TBV Earn Back Period EPS Impact Market Density Deposit Base < 3 Years Meaningful earnings accretion in first full year of operations Builds upon footprint in current markets Steady, low - cost funding x 1 x 1 x 1 x 1 SmartFinancial is com
Slide 14: A History of Methodical Growth
14 $422,655 $443,446 $507,702 $533,801 $1,023,963 $1,062,456 $1,720,771 $2,274,409 $2,449,123 $3,304,949 3,728,980 A History of Methodical Growth ‘15 ‘16 ‘17 ‘18 ‘19 ‘20 ‘14 ‘12 ‘13 ‘11 Merger of Equals: Cornerstone Bancshares Assets: $436mm FDIC Acquisition: GulfSouth Private Bank Assets: $159mm Fu
Slide 15: Appendix
A SmartFinancial Appendix
Slide 16: Pro Forma Company Snapshot
16 Pro Forma Company Snapshot December 31, 2020 - Deposit / Loan Mix SMBK SVRH Pro Forma $2.4bn $246mm $2.6bn $2.8bn $381mm $3.2bn Pro Forma 1 Assets $4.0bn Loans / Dep. 79% TCE/TA 8.1% Leverage Ratio 8.1% Tier 1 Ratio 11.6% Total RBC Ratio 13.8% SMBK Price 2 $21.25 Price / Pro Forma TBVPS at Closin
Slide 17: Non-GAAP Reconciliations
17 Non - GAAP Reconciliations 1) Total SVRH shares outstanding of 4,366,477 including restricted stock units which will vest upon the change - in - control Financial Information at and for the Twelve Months Ended December 31, 2020 ($ in thousands except per share data) SMBK Tangible Common Equity ("
Slide 18: Investor Contact
18 Billy Carroll President & CEO 865.868.0613 billy.carroll@smartbank.com Miller Welborn Chairman 423.385.3067 miller.welborn@smartbank.com 5401 Kingston Pike, Suite 600 Knoxville, TN 37919 Investor Contact
Slide 19: 19
19